A Better Year Awaits
As the year comes to a close, people look to the upcoming year with optimism. What can make next year better than the current year? For some this might mean a better relationship, a better job, a healthier lifestyle, and for some a financial fresh start. For those that have struggled during the current year and past years, they envision a future year either free from debt or on a program to manage the debt. What I am referring to is either a chapter 7 fresh start bankruptcy or a chapter 13 reorganization bankruptcy. Either one of these chapters, depending on the person’s particular situation, will provide a great form of relief.
Chapter 7 Bankruptcy
Chapter 7 is the most common form of bankruptcy. Nearly three out of every four consumer bankruptcy cases is ba chapter 7. This type of bankruptcy eliminates most credit cards, medical bills, personal loans, past-due utilities, auto repossession deficiencies, mortgage deficiencies, and debts for just about any other type of service. There are qualifications for chapter 7. The individual must not have significant, non-exempt assets which can be taken by a chapter 7 trustee. The person must not have the ability to repay a portion of the debt over a 3 to 5 year period. The person also must not have committed certain acts of fraud which would prevent the case from going forward.
Chapter 13 Bankruptcy
Chapter 13 is a reorganization whereby an individual or couple repays all or a portion of the debt over a 3 to 5 year period. This is based on the income minus expenses of the individual or couple. A typical chapter 13 case would be to save a home that is in foreclosure, save an auto from repossession, repay non-dischargeable debt such as parking tickets at a rate of less than 100%, and otherwise reorganize debt were a chapter 7 is not possible due to asset considerations.
The qualifications for filing either chapter are very similar. A person must submit to a credit counseling session within 180 days prior to a case being filed. The person must provide at least two months’ worth of pay advices or other proof of income that has been received within the two months prior to filing. The person must also provide one year of federal tax returns in a chapter 7 and four years of federal tax returns in a chapter 13 prior to filing. These requirements are necessary either before a case is filed or immediately thereafter in some circumstances to prevent a case from being dismissed by statute. If you contact an experienced bankruptcy attorney in your local area, you will be informed about all the requirements and all the steps necessary to move your case from filing through completion.
The Time Is Now For Change
The reason why this article is so important at this time is that by filing now or at least taking the steps necessary to file now, an individual will gain a fresh start or a sense of relief prior to the close of the year. That way the following year can be better than the current year at least in terms of finances and debt management. There is a plethora of information swirling around the internet concerning bankruptcy. Do yourself a big favor and only talk to individuals or law firms who are significantly experienced in the field. You can determine that very easily by the nature of the practice, the associations and accreditations that the attorney may have as well as published material, videos, comments, blogs, reviews, and anything else associated with that law firm as it relates to bankruptcy. For more information and for unanswered questions, you may contact me directly at 847-520-8100. Since 1991, I’ve been helping individuals and families either eliminate debt or reorganize debt under the United States Bankruptcy Code.